Developed countries need to pay up
A financial package to support sustainable investments in the poorest countries could boost development, stimulate manufacturing in richer countries and lead to global environmental sustainability, says Jeffrey Sachs.
The current economic crisis is hitting developing countries hard — bank loans to middle-income countries are expected to fall by US$60 billion, expatriates are returning home or reducing the amount of money sent back, and donor countries are cutting aid.
The developed world had promised Africa US$60 billion in aid per year up to 2010. Just half of this is actually delivered — compared to trillions of dollars spent at home in the last four months on financial bailouts and stimulus packages.
What donor countries fail to realise, argues Sachs, is that following through on their promises to build African infrastructure would not only help Africa pump clean water, irrigate crops and power hospitals, but would also provide an enormous stimulus for the faltering factories in developed countries.
Sachs recommends the G20 countries devote at least US$25 billion of "urgent additional funding" to African sustainable development in 2009 and another US$25 billion for low-income countries elsewhere. If the needs of the poor remain unaddressed, all the world will lose, he warns.